Adverse Credit – Used to apply to an application that has past problems with bad credit, for instance frequent late payment, breached arrangement, bankruptcy or County Court Judgement.
Arrears – Money unpaid by the tenant in whole or in part after the due date specified in the tenancy agreement.
Assured Shorthold Tenancy – A tenancy agreement is a legal contract between landlord and tenant. The agreement contains the terms and conditions of a tenancy, such as the duration of the agreement and the rental amount payable by the tenant. It is the most common type of tenancy in the rental private sector.
Break Clause – A term in a fixed term tenancy agreement which allows either or both parties the right to terminate the agreement prior to the end of the term.
Check-in -This is the process of moving a tenant into a rental property for the first time. The check-in process should include an inventory which describes in detail the condition of the property prior to the tenant moving in.
Check-out – This is the process of moving the tenant out of the property and includes making sure the property is being returned in the same condition as it was originally let to the tenant at check-in, subject to fair wear and tear.
Contents Insurance – Insurance against accidental damage or theft of all moveable contents, including furniture, appliances and soft furnishings.
Credit Search References – References requested for a tenant applying for rented accommodation. Many agents and individual landlords use external companies who will contact the applicant’s employer, landlord and also check out the tenant’s credit history and search public records, providing a report on the prospective tenant’s financial suitability to rent.
Deposit (lettings) – A sum of money usually up to 5 weeks rent to ensure a tenant complies with the terms of their tenancy agreement.
Deposit Protection Schemes – These government-backed schemes ensure you will get their deposit back if you: meet the terms of your tenancy agreement; don’t damage the property; and pay the rent and bills. Your Landlord (or your letting agent) must put the tenants’ deposit in the scheme within 30 days of the deposit being handed over. At the end of the tenancy the deposit must be returned to the tenants within 10 days of agreement on how much the tenant will get back. If you’re in a dispute with your landlord, the deposit is protected in the TDP scheme until the issue is settled.
Dilapidations – Damage to a property, missing items in an inventory, re-decoration required etc, usually assessed on the check out at the end of the tenancy. Landlord’s may only seek equitable reparation subject to fair wear and tear.
Direct Debit – A Direct Debit is an instruction from a customer to their bank or building society to make regular payments direct from their account.
Energy Performance Certificate (EPC) – This is a legally required assessment of how energy efficient a residential property is. It is valid for 10 years and is required for all properties which are advertised for sale or rent with certain exceptions.
Extension or renewal of tenancy – This is where a tenancy due to come to an end can be extended or renewed with the consent of both the landlord and the tenant. Extensions and renewals may be subject to negotiated terms such as a change in rent.
Fair Wear & Tear – There is no legal definition of “fair wear and tear”. It is subjective and depends on a number of factors. Essentially, it is the amount of damage or deterioration that can be reasonably expected in all the circumstances. You could define it as damage caused by ageing and normal use. In the context of a residential letting, it means damage to carpets, decorations, fixtures, fittings and furniture that would reasonable by expected during a tenancy and allowing for the lifespan of the item in question.
Guarantor – A guarantor is someone who promises to pay your rent if you can’t or won’t for any reason. This guarantee is legally binding.
Holding Deposit- A holding deposit is intended to reserve a rental property. The landlord/agent does this by taking the property off the market, though new enquiries should still be recorded. If the letting goes through, the holding deposit can be credited to the rent or returned depending on office process. If the letting does not go ahead, through the fault of the prospective tenant, then it’s usual for the deposit or part of the deposit to be retained in compensation for lost time – this belongs to the landlord. If the letting does not go ahead through the fault of the landlord/agent then the deposit should be refunded. In all cases there should be a written Holding Deposit Agreement / Receipt which makes it very clear what will happen to the deposit in these eventualities and when the deposit should be returned or retained. It is important to remember that paying a holding deposit is in no way legally binding on either party.
Identity checks – Letting agents must make checks on tenants to ensure they are who they say they are. Examples include passport, driving licence, bank statements and utility bills of a previous address you have lived at for three or more years. The money laundering regulations govern these checks.
Joint & Several Liability – Where there is more than one adult living in the property, the tenancy will say they are “jointly and severally” responsible. This means that, jointly, the tenants are liable for the payment of all rents and all liabilities falling upon the tenants during the tenancy, as well as any breach of the Agreement. Individually each tenant is responsible for payment of all rent and all liabilities in relation to the tenancy, as well as any breach of the agreement until all payments have been made in full.
Joint Tenants – A form of ownership frequently used by couples which ensures that when one dies, the property passes automatically to the other. The alternative is Tenancy in Common.
Ombudsman – An independent professional body which is set up by law to help settle individual disputes between consumers and firms, for example, letting agents, solicitors and insurance companies.
Portable Appliance Test (PAT) – A test in the United Kingdom by which electrical appliances are routinely checked for safety. The correct term for the whole process is In-service Inspection & Testing of Electrical Equipment.
Section 21 Notice The notice which must be served to end a tenancy.
Service Charge – The cost of repairing and maintaining external and/or internal communal parts of a building, which are then charged to the tenant or leaseholder.
Statutory Periodic Tenancy – If at the end of a fixed term tenancy, neither party does anything and no further agreement is made, the tenancy will automatically run from one rent period to the next on the same terms as the preceding fixed term assured shorthold tenancy. It will continue to run on this basis until replaced by a new agreement or by one party giving the other notice. Once notice is served, it will only be effective from the start of the next period of renewal and will end on the last day of that period. The tenant will have to provide not less than 1 months notice and the landlord not less than 2 months.
Tenants – People living in a property on a non-ownership basis.
Unlawful eviction – Eviction of a tenant from residential property by preventing them from occupying the premises for example by changing the locks. This is a criminal offence under the Protection from Eviction Act 1977 and could lead to a prison term, a fine, or both.
Void Period – The time when a rental property is unoccupied and no rent is received.
